Founder warns FCA Over Regulation May Stifle Potential of Crowdfunding.
Entrepreneur Karen Darby has launched a crowdfunding site to fund social, environmental and health-related businesses. CrowdMission will challenge banks and venture capitalists and put investment opportunities in the hands of ordinary people.
“CrowdMission is all about making money and making a difference. We connect investors to ambitious, high-growth businesses with a social dimension. These businesses could one day be real game-changers and have a truly beneficial effect on the planet”, said Darby.
CrowdMission allows ordinary people to invest from as little as £10 in return for shares in businesses that benefit society. It has set itself a target to help, nurture and support 10,000 social entrepreneurs in the next five years.
Every business that seeks funding through the CrowdMission platform must provide an obvious benefit to society, health or the environment. This social impact must be above-and-beyond the commonplace social benefits of running a business, such as the creation of jobs or stimulation of the local economy. CrowdMission is particularly keen to work with social entrepreneurs, green energy businesses and bioscience companies.
At launch, CrowdMission is helping to fund a number of businesses. One of the first is Power Predictor, which has created tools to analyse the potential for solar and wind energy production. Power Predictor helps governments, businesses and homeowners identify the true potential for renewable energy generation based on actual weather conditions at any specific site. Power Predictor, which has already sold more than 15,000 units world-wide, is looking to raise £250,000 on CrowdMission.
Other businesses on CrowdMission at launch, include:
- Big Blue Cuddle, an online store for colourful children’s clothes which supports children’s charities while introducing new brands to the UK market
- iPower, which makes energy more affordable by installing fuel cells, which convert gas into electricity as efficiently as an industrial power station
Darby commented on her platform,
“The businesses that feature on our platform are not only great investment opportunities, they provide tangible benefits to society. Ultimately, we would love to help bring to market a cure for cancer or some new technology that radically reduces pollution. Innovators in bioscience and green technology don’t necessarily see themselves as social entrepreneurs, but to us they’re heroes. It’s their companies that have enormous potential to change lives as well as making a healthy profit for investors.”
A staunch proponent on the power of crowdfunding, Darby warns that the Financial Conduct Authority (FCA), which is drawing up plans to regulate the crowdfunding industry in April next year, may try to impose rules on who can invest through crowdfunding sites. The FCA has previously seemed keen to restrict crowdfunding sites to deal exclusively with high net worth individuals and those with professional investment experience.
“This fledgling industry needs to stand firm and not accept every rule proposed by the regulator. While crowdfunding is quickly being embraced by both investors and businesses, the ‘nanny state’ stance being taken by the FCA may well smother the crowdfunding model in its infancy. This is something that can’t be allowed to happen.”
Karen Darby has launched a number of businesses in a career spanning three decades. Previously she founded SimplySwitch, the price comparison service, in one of the UK’s most deprived areas. Employing over 100 staff, SimplySwitch raised £500k for charity and helped thousands of consumers save over £20m on their household bills. In August 2006, Karen sold the business to the Daily Mail for £22 million, producing a 22-fold return for investors.